Auckland to meet bulk of bail-out

Press, 6 September 1989, Page 1

Auckland to meet bulk of bail-out

By

BARRY CLARKE

The Government will underwrite one third of any Commonwealth Games loss, up to $2O million, a meeting in Auckland decided last evening.

The move temporarily eased the cash crisis facing the Games and ensured the $25 million deficit faced by organisers would not hinder the smooth running of the event in January, Mr Frank Ryan, the chairman of the Auckland transitional committee, said last evening. Auckland local authorities will underwrite the other two thirds of the $2O million figure agreed upon at last evening’s emergency meeting called to settle a deal on the bail-out.

The Minister of Sport and Recreation, Mr Tapsell, and the Minister of Special Events, Mr Douglas, thrashed out the issue with Games organisers and Auckland local body politicians for four hours before announcing a decision shortly before 9.30 p.m. Local authorities had gone into the meeting determined not to contribute any more, but the Mayor of Auckland, Dame Catherine Tizard, said the “bottom line” was that the Government could, and would, legislate to make them do so, as threatened on Monday by the Prime Minister, Mr Palmer. “It is called co-operating with the inevitable,” she said. Dame Catherine said the underwriting agreement was “a realistic assessment of each others’ position.” Mr Ryan said the Auckland transitional committee members had met earlier in the day to plan a strategy and had come away from last evening’s meeting “quite satisfied.” The transitional committee is empowered to make some decisions for the local bodies which will merge under pending local government reorganisation. In return for the increased Government and Auckland contribution, however, both will have greater say in organisation of the Games.

The Government has already contributed $23 million to the Games — $ll million from taxation and $l2 million from the Lotteries Board. If organisers cannot raise the $2O million between now and a deadline of June 30, 1990, the New Zealand taxpayer will pay almost another $7 million. Mr Ryan said the Govememnt

had agreed to immediately inject money into the Games. A special committee would be set up to determine how to deal with the shortfall of $5 million between the $2O million underwriting ceiling set yesterday and the budget deficit. Sponsorship and cost-cutting would be employed. He emphasised that the money would not be got from a levy on Auckland ratepayers. “There are many ways which the money could be raised — a special tax on motorways, airport levies, lottery tax or petrol tax,” he said. The meeting also resolved to appoint as “watchdog” members an additional Government representative and two more Auckland transitional committee members to the Commonwealth Games, Ltd, board.

Mr Ryan said the meeting was given accurate details of the expected deficit and would monitor the situation closely. A leading sports administrator, Sir Ron Scott, of Christchurch, yesterday said he was confident the Games would go ahead successfully. Sir Ron, chairman of the Hillary Commission, said: “I’m not going to join the chorus calling for blood. Aucklanders are New Zealanders.”